vsmith112298
Nov 12, 2008, 05:32 PM
What is and how do I find the average issue price of stock
codyman144
Nov 12, 2008, 07:14 PM
Weighted average is how you do it.
For example say you sold (A) 100 shares at $50, then (B) 200 shares at $30 and finally (C) 50 shares at $15.
You need to 'weight' each purchase by the number of shares sold. In other words what is the relative percentage of each purchase to the total number outstanding?
You sold a total of 350 shares. Divide each purchase by the total. 100/350 = 29% 200/350 = 57% and 50/350 = 14%
Now that you know the weight (percentage of each purchase) just calculate the % times the price and sum all the results.
$50 * 27% = $14.29, $30 * 57% = 17.14 and $15 * 14% = 2.14
14.29+17.14+2.14 = $33.57
Please note I rounded some of the above numbers (so they are easier to type), if you want to replicate my results exactly use excel which does not round and keep everything formula driven.